United Kingdom Inheritance Tax Changes - To De-Envelope Or Not?

Summary:

• the United Kingdom (“UK”) government has recently confirmed that non-domiciles who hold residential property via an offshore company will be subject to inheritance tax from 6 April 2017;

• we understand that this is the latest in a raft of changes to the UK tax regime of non-domiciles designed to eradicate the previous advantages of owning UK residential property via offshore companies;

• we are assisting clients ‘de-envelope’ their UK residential properties (i.e. transferring the property out of the offshore company’s ownership) by way of voluntary liquidation in both the British Virgin Islands (“BVI”) and the Cayman Islands; and

• given the imminent date of implementation, and the lead time to complete such transactions, we are seeing an increase in the number of properties being de-enveloped by way of voluntary liquidation in both the BVI and the Cayman Islands.

 

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LONDON
John O'DriscollPartnerT +44 (0)20 7220 4987john.o'driscoll@walkersglobal.com
Paul GossSenior AssociateT +44 (0)20 7220 4985paul.goss@walkersglobal.com
Cate BarbourAssociateT +44 (0)20 7220 4970cate.barbour@walkersglobal.com